CPI causing growing fear

December 02, 2010 | 11:48

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The consumer price index this year is becoming a prime concern for society.

Vietnam’s consumer price index (CPI) rose 9.58 per cent in November 2010 against December 2009 in which the average CPI in the last three months hiked approximately 1.41 per cent per month.

Based on these figures, three following scenarios were proposed for 2010’s CPI.

The CPI would remain in single digits if December’s CPI rose slightly as it did in 1995 and 2002 when it stood at 0.3 per cent or 0.1 per cent in 2000. It even contracted minus 0.68 per cent in 2008.

If December CPI managed growth similar to average December CPI growth level from 1993 to 2010 of 0.8 per cent, 2010’s CPI would grow approximately 10.5 per cent.

If December CPI’s hiked 1.38 per cent as it did one year ago, the whole year’s CPI would be 11.09 per cent.

Analysts assumed that it was nearly impossible to turn the first scenario into a reality, while a comprehensive suit of strong and consistent measures were needed to be taken for the second scenario to become attainable. Given current context, the last scenario would be most likely to happen.

Analysts warned the high CPI growth would continue in the first two months of next year.

The CPI growth was almost double between December 2003 and November 2010.

The high CPI growth in the last three months was partly infused by escalating gold and Vietnam dong-US dollar exchange rate in the domestic market.

In late 2009 National Assembly deputies voted for CPI growth of less than 7 per cent in 2010. In May 2010, the Vietnamese government adjusted 2010 CPI growth to be at most 8 per cent.

CPI growth (per cent) through November 2010